When can retirement plan distributions begin?

Two different questions

People mean two things by “when can distributions begin.” The first is the earliest the money can come out without a plan restriction. The second is the latest the plan must start paying it. Publication 560 answers both, plus a third question that often hides inside the first: when a withdrawal is penalized. This page keeps them separate.

Earliest: 401(k) plans

Publication 560 says distributions from a 401(k) plan generally cannot be made until one of four things occurs. The employee retires, dies, becomes disabled, or otherwise severs employment. Or the plan ends and no other defined contribution plan is established or continued. Or, for a 401(k) that is part of a profit-sharing plan, the employee reaches age 59 and a half or suffers financial hardship, with the hardship rules in Regulations section 1.401(k)-1(d). Or the employee becomes eligible for a qualified reservist distribution, available to a military reservist or National Guard member called to active duty for at least 180 days or indefinitely.

A distribution allowed by the plan can still cost an additional 10% tax if taken before age 59 and a half; the publication lists exceptions including death, disability, substantially equal periodic payments, and a separation from service in or after the year the employee turned 55 (for a plan other than an IRA). See our 401(k) early withdrawal calculator.

Earliest: SEP and SIMPLE IRAs

SEP IRAs and SIMPLE IRAs are IRAs, so IRA rules govern. For a SEP, an employer cannot prohibit distributions or condition contributions on any part of them staying in the account. For a SIMPLE IRA, a tax-free rollover to a non-SIMPLE IRA can be made only after 2 years of participation, and early withdrawals face a 10% additional tax that rises to 25% if the funds are withdrawn within 2 years of beginning participation. Distributions are generally included in income when received. Pubs. 590-A and 590-B hold the detailed IRA rules.

Latest: the required beginning date

A qualified plan must provide that each participant either receives their entire interest by the required beginning date or begins regular periodic distributions by then, over life expectancy or a shorter period. The date is April 1 of the first year after the later of two years: the calendar year the participant reaches age 73, and the calendar year the participant retires from the employer that maintains the plan. A plan may instead require distributions by April 1 after the year of reaching 73 even if the participant has not retired. A participant who is a 5% owner of the employer must start by April 1 of the first year after the calendar year they reach age 73, retired or not.

For SEP and traditional SIMPLE IRAs, the date is April 1 of the first year after the calendar year in which the owner or employee reaches age 73.

Worked example

Dana turns 73 in 2026 and keeps working until she retires in 2028. She owns no part of the company. Her required beginning date is April 1, 2029 (the later year is 2028, so the first year after is 2029), unless the plan requires earlier distribution. If she were a 5% owner, the date would be April 1, 2027. The calculator above covers these cases. After the starting year, each year’s required distribution is due by December 31. The April 1 distribution counts as the starting year’s distribution, so if you wait until April 1 you must take 2 years of required distributions in that second year: one by April 1 and one by December 31.

Roth accounts are different

The lifetime required distribution rules do not apply to amounts in a designated Roth account in a qualified plan; required distributions from a designated Roth account are required only after the participant’s death. A distribution from a Roth account is entirely tax free if it is a qualified distribution: made after a 5-tax-year period and on or after age 59 and a half, on disability, or on death.

Finally, remember that withdrawals are not the same as rollovers. An eligible rollover distribution that is paid to you rather than directly to another plan generally has 20% federal income tax withheld; a direct rollover has none. The 1099-R codes page helps read the reporting.

Sources

• IRS Publication 560, Retirement Plans for Small Business (SEP, SIMPLE, and Qualified Plans) (2025): Chapter 2 (SEP Distributions (Withdrawals)); Chapter 3 (SIMPLE IRA Distributions (Withdrawals)); Chapter 4 (Required Distributions; Distributions From 401(k) Plans; Tax Treatment of Distributions; Tax on Early Distributions). Read November 2, 2026.

Edition read: Publication 560 (2025), for use in preparing 2025 returns. Where the publication gives 2026 figures, this page labels them 2026. Dollar limits change every year; check the current publication and form instructions for your plan year. This page summarizes the publication and does not replace it.